NetApp Reports Second Quarter Fiscal Year 2017 Results

View Financial Tables(PDF)

Net Revenues of $1.34 Billion; Up 4% Quarter-over-Quarter;
GAAP EPS of $0.38 and Non-GAAP EPS of $0.60

• All flash array annualized net revenue run rate exceeded $1 billion
• Over 200 petabytes of flash shipped
• Clustered Data ONTAP™ deployed on 86% of systems shipped
• $169 million returned to shareholders in share repurchases and cash dividends

Sunnyvale, Calif.—November 16, 2016—NetApp (NASDAQ: NTAP) today reported financial results for the second quarter fiscal year 2017, ended October 28, 2016.

Second Quarter Financial Results
Net revenues for the second quarter of fiscal year 2017 were $1.34 billion. GAAP net income for the second quarter of fiscal year 2017 was $109 million, or $0.38 per share,^[1]compared to GAAP net income of $114 million, or $0.39 per share, for the comparable period of the prior year. Non-GAAP net income for the second quarter of fiscal year 2017 was $169 million, or $0.60 per share,^[2]compared to non-GAAP net income of $181 million, or $0.61 per share, for the comparable period of the prior year.

Cash, Cash Equivalents and Investments
NetApp ended the second quarter of fiscal year 2017 with $4.4 billion in total cash, cash equivalents and investments. During the second quarter of fiscal year 2017, the Company generated $158 million in cash from operations and returned $169 million to shareholders through share repurchases and a cash dividend.

The Company announced the next cash dividend of $0.19 per share. The quarterly dividend will be paid on January 25, 2017, to shareholders of record as of the close of business on January 6, 2017.

“Our second quarter results are evidence of our ability to maintain a high level of execution while streamlining the business and pivoting to the growth areas of the market,” said George Kurian, chief executive officer. “Our market-leading innovations in flash, next-generation data centers and hybrid cloud, coupled with a sharp focus on operational discipline, position NetApp to lead in the digital era.”

Q3 Fiscal Year 2017 Outlook
The Company provided the following financial guidance for the third quarter of fiscal year 2017:

• Net revenues are expected to be in the range of $1.325 billion to $1.475 billion.
• GAAP earnings per share is expected to be in the range of $0.41 to $0.46 per share.
• Non-GAAP earnings per share is expected to be in the range of $0.72 to $0.77 per share.

Business Highlights

• Increasing Flash Momentum
  • NetApp Recognized as a Leader in Gartner Magic Quadrant for Solid-State Arrays.NetApp named a Leader in the 2016 Gartner Magic Quadrant for Solid-State Arrays, based on the ability to execute and the completeness of vision. According to Gartner, Leaders execute well against their current vision and are well positioned for tomorrow.^[3]
  • NetApp Takes Top Honors for Customer Implementation, Brand Leadership at Flash Memory Summit 2016.NetApp’s SolidFire™ deployment was recognized for customer innovation at Internet Solutions and NetApp swept all six brand leadership categories for all-flash NAS and unified SAN/NAS arrays in the 2016 Brand Leader Survey.
• Simplifying Data Management with New Solutions
  • New NetApp Software and Flash Systems Simplify Data Management.NetApp ONTAP software, flash systems and expanded public cloud support for Microsoft Azure provide the modern foundation to help customers maximize the value of data in the hybrid cloud.
  • NetApp Boosts Performance, Lowers Cost of Data Analytics Applications for Midsize Businesses, Remote Offices.NetApp SANtricity™ software and the entry-level E2800 all-flash array deliver affordable performance and simplify the process of extracting value from third platform data.
• Delivering Positive Customer Outcomes
  • UZ Leuven Speeds Collaboration of 17 Hospitals with NetApp Flash.This hospital network teams with NetApp to move, manage, and protect 6PB of critical patient data and was able to roll out new features across 17 hospitals within business hours with no downtime.
  • Inland Northwest Health Services/Engage Protects Critical Patient Data, Boosts Care with NetApp.NetApp helped the technology arm for this healthcare provider create a new cloud service based on AltaVault™ that allows it to easily and affordably secure critical customer data.
  • Buzinessware Fuels its On-demand Managed Infrastructure with NetApp SolidFire All-Flash Storage.Buzinessware, a Middle Eastern hosting and cloud service provider, teams with NetApp to deliver the exact level of performance required for each customer application and is able to make changes to performance and capacity on the fly without any disruption.
  • RapidScale Accelerates Enterprise Profitability with NetApp.NetApp’s All Flash FAS gives RapidScale, a cloud service provider, a solid foundation to support its 100% annual growth, helping to preserve profit margins through storage efficiency, administration, and time savings.
  • TechnologyOne Selects NetApp to Improve Profitability and Efficiency of Its SaaS Cloud Offering.NetApp enabled Australia’s largest enterprise software company to respond to changing customer needs by adopting a multi-cloud approach without increasing costs or complexity.

Webcast and Conference Call Information
NetApp will host a conference call to discuss these results today at 2:30 p.m. Pacific Time. To access the live webcast of this event, visit the NetApp Investor Relations website atinvestors.netapp.com. In addition, this press release, historical supplemental data tables, and other information related to the call will be posted on the Investor Relations website. An audio replay will also be available on the website after 4:30 p.m. Pacific Time today.